Almost three decades ago, a dropout student from Tunghai University in Taichung made the bold move of buying up computer monitor inventory from Japanese electronics giant Matsushita and then selling it in the United States under his own brand, “ViewSonic.” This coup laid the foundation for the brand’s rise.

At one time, ViewSonic, whose logo features three colorful Gouldian finches, was the world’s largest display brand. Today, this long forgotten former pride of Taiwan is staging a comeback on the back of the digital classroom trend, quickly rising to the world’s No. 3 in the digital classroom sector with smart interactive flat panel displays. How did ViewSonic founder James Chu pull this off?

                               

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Liancheng Road in New Taipei’s Zhonghe District is home to several major display manufacturers such as Admiral Overseas Corporation (AOC) and AmTran Technology. On one side of the busy street towers the dark green ViewSonic International Corporation high-rise with a large, eye-catching sign board featuring the three Gouldian finches and ViewSonic lettering in front.

In the foyer of the 7^th floor visitors are greeted by Wonderful Bait, a colorful oil painting by contemporary Philippine artist Ronald Ventura. This artwork belongs into the private collection of ViewSonic International Corporation Chairman James Chu. It is also his favorite painting.

It shows a dark brown horse forcefully galloping off out of the danger zone after jumping through a ring of fire. It seems to be a fitting portrayal of Chu and the ViewSonic brand that he single-handedly built.

In 1990, Chu founded ViewSonic in California. Within just ten years, he managed to grow the company into the world’s largest computer display brand.

The 62-year-old Chu hails from an Air Force officer’s family in Taiwan’s southern Pingtung County. He studied at the Department of Sociology atTunghai University but dropped out before graduation. Originally an inarticulate and reserved person, Chu morphed into a lively and energetic character when making some money on the side, selling goods from a makeshift stall as a student. One could say he had a natural penchant for doing business.

ViewSonic International Corporation Chairman James Chu who single-handedly built the ViewSonic brand. (Photo by Ming-Tang Huang/CW)

In 1987, Chu, then 30 years old, left the technology firm where he originally worked. He borrowed US$100,000 from his older sister, who now serves as ViewSonic vice chairperson, and went to California to build a business.

Personal computers were booming in the 1990s . Chu started out as sales agent for PC peripherals. A few years later, after he decided to establish the ViewSonic brand, he focused his energy on cathode-ray tube (CRT) display products, inventing the “American brand, made in Asia” business model.

Grabbing Market Share with ‘Affordable High-end’ Products

Back then, more than 90 percent of monitors were produced for the low-end market. Only a few large Japanese electronics makers were active in the high-end segment, but their prices were sky-high. A high-end NEC monitor could easily cost US$1,000 whereas a monitor of the same size in the medium or low-price range would cost up to US$300 less.

Convinced that consumers wanted products that are high quality but not expensive, Chu regarded this as the opportunity for ViewSonic to gain market share. As a result, he launched ViewSonic’s stunning, miraculous climb to the top.

He targeted the high-priced brand NEC, which was ranked No. 1 in the American market at the time. On top of that, he picked Japanese electronics giant Matsushita as a contract manufacturer for ViewSonic monitors.

“If you want to build a medium- to high-priced brand, just claiming to be medium-high is not enough; your quality must be medium-high if you want to compete with Japanese brand NEC. That’s why I asked Matsushita from Japan, who is playing in the same league, to manufacture for us,” says Chu as he explains the rationale behind his strategy.

However, what ace did Chu, this young Taiwanese, have up his sleeve to convince an eminent company like Matsushita, which had its own brand, to take contract orders from upstart ViewSonic?

He simply had luck on his side. In 1990, Matsushita changed its business strategy, going for the medium- to low-priced monitor segment. These devices were produced at the Matsushita factory in Kyushu. Consequently, Matsushita headquarters in Tokyo’s Shinagawa Ward was left with massive inventory of medium- to high-priced 17-inch monitors.

This happened to be just around the time when Chu knocked on Matsushita’s door. Chu, the consummate salesman, assured the Matsushita management that he would be able to sell 20,000 computer keyboards per month. Every desktop computer/keyboard combo would have to be sold in combination with a display. Eager to find a channel for its inventory, the Matsushita management began to warm to the idea. 

Small Fish Persuades Big Fish, Three Colorful Birds Build Brand Reputation

“We were a small fish, but they (Matsushita) were in a desperate situation, ready to clutch at straws,” says Chu.

Against expectations, ViewSonic’s branding strategy – selling medium-high quality at a 15% lower price than NEC’s US$1,000 price tag supported by a relentless advertisement campaign featuring the logo with the three Gouldian finches – proved highly successful. On the first try, Chu sold six full container loads of monitors, by far exceeding the three container loads that he had promised Matsushita.

The deal with Chu not only helped Matsushita solve its inventory problem, it also prompted the decision to open new production lines. ViewSonic’s success in the American market fell back on Matsushita as it subsequently won orders from Apple. Cooperation between ViewSonic and Matsushita became even closer as a result, so that at one time ViewSonic even became Matsushita’s largest brand customer.

Buoyed by the logo with the three colorful birds, ViewSonic took off, soaring high. Not only did it squeeze out NEC but in early 2000 Chu officially announced the acquisition of Nokia’s display business. Within just eight years, ViewSonic had come to dominate the computer monitor sector for 14-inch to 22-inch displays, becoming the largest display brand in the world. 

“In the 1990s, people would be in awe if you had a monitor of the ‘three birds’ brand in your home,” recalls a former executive of AmTran Technology, which once filled ViewSonic contract orders. Like Sony monitors, the ViewSonic products had a high-quality image.

ViewSonic once generated more than US$1.3 billion in global revenue per year, reaching rank 228 in the American Top 500 private enterprises. Therefore, Chu was honored with the prestigious “Outstanding Chinese American Award”, reaching the top of the business world.

But with the emergence of notebook computers, smartphones and laptops, ViewSonic gradually vanished from the high-tech radar, becoming a distant memory.

Carving out a Different Path in the ‘Smart Blackboard’ Segment

Recently Chu’s name is appearing in the news again, often being mentioned in one breath with schools. In early October, he made an appearance at the launch of a strategic partnership between ViewSonic and National Taiwan Normal University (NTNU) to promote “Ed Tech” and to announce the rollout of the “ViewSonic Innovative Classroom” at the NTNU College of Education.

The event marked the official rollout of smart interactive flat panel displays known as ViewBoard at NTNU. As Taiwan’s leading teacher training institution, NTNU serves as a demonstration site for education technology.

The touchscreens look like large, wall-mounted LED TV sets. Teachers can use the screens not only to display and manipulate their own teaching materials but also with electronic pens as big as a piece of chalk to write or draw directly on the screen, or to interact with the students in real time.

Photo by Ming-Tang Huang/CW

“The education market is huge,” asserts Chu. Sitting in his office, he says: “We spent some time building up our endurance and strength as we needed to map out a path that sets us apart from others.”

In 2018, around 1.93 million interactive whiteboards were shipped globally, according to a Q2 2019 report by tech consultancy Futuresource on interactive displays in the education and corporate sectors. Shipments are expected to grow to 2.52 million per year by 2023 with an application ratio of 83 percent in the education market, the report said. After spending three years promoting its smart interactive displays, ViewSonic has already become the third-largest brand in the world, behind U.S.-based Promethean and Smart Technologies from Canada.

In 2019, more than 5,500 public elementary and junior high schools across the United States had installed ViewBoards. In Taiwan around ten schools including NTNU had introduced them.

“Their use in the education field is still in the initial stage; in Europe and North America they have become more common over the past three years,” notes Lin Yu-kang, manager with the ViewSonic Global Product Marketing Department. Although projectors and whiteboards are routinely used in schools, teachers still stick to the top-down approach familiar from writing on blackboards. Therefore, there is a lot of room for growth in the smart interactive display segment.

Emergence of LCD Screens Triggers New Display War

Smart interactive displays for classrooms were Chu’s gamble for ViewSonic’s comeback after it had hit rock-bottom. As far as Chu was concerned, this was not only a live-or-die transformation for his company but more of a bloody battle for survival in the display industry.

“I know that the brand is very important. But now having a brand alone is not enough; you need to better understand user needs,” saysChu.

That’s what he learned as the company staggered along during its transformation over the past 10 years.

Having observed the panel and display industries for many years, David Hsieh, senior director for display technology research and analysis at the consulting firm IHS Markit, remembers the early days of Chu’s brand building exercise. “He definitely scored success in the beginning by aptly using the model of manufacturing with an Asian supply chain and selling in the American market.”

But the company’s peak as the globally leading display brand was dealt a heavy blow when display prices collapsed due to the advent of LCD panels.

During the early CRT era, when consumers used to choose famous monitor brands, the high-quality ViewSonic brand was very popular. But later on, when the trend moved toward thin LCD displays, the large PC brands such as Dell and Compaq (which was later merged with Hewlett-Packard) also began to make displays themselves, which they sold in a bundle with their computers. Against this backdrop, ViewSonic, as a display-only maker, gradually lost consumer support.

“ViewSonic had positioned itself as a medium to high-end brand. In a market with declining display prices, it was hard to compete,” says Chu.

In 2002, during peak times, ViewSonic shipped more than five million displays per year. Today the company ships only 3.3 million LCD monitors in an entire year, barely making it into the top ten, according to IHS statistics.

Photo by Ming-Tang Huang/CW

“In the more than 10 years in between we always tried to transform,” remarks Chu, who has never shunned a challenge. But he admits: “When there is not much of a difference between you and your competitors, your company will have problems surviving.” ViewSonic once tried to release tablet computers, LCD TVs, PDAs, etc., but none of these efforts met with success.

During the financial crisis of 2008-2009, ViewSonic was close to collapse. A display industry executive reveals that, “At the time, many suggested to James that he should sell the company and cash out.” Interested parties who talked with ViewSonic at the time included China-based Lenovo, which had bought IBM’s personal computer business group a few years earlier.

As ViewSonic’s Global Chief Operating Officer Han Min-chu, who already worked at the company back then, remembers, the company suffered steep losses at the time.

“Although the company was at a low, James was always able to keep his cool, leading everyone to overcome the difficult times,” recalls Han. She remembers how Chu, who was usually quite flexible when it came to decision-making, insisted strongly on the brand identity with the finches and cash flow management.

Back then, the company’s cash conversion cycle reached 50 days at one point. Chu was aware that cash flow was very important given that a financial crisis was in the making. Therefore, he set the term of payment at 30 days and offered customers who were willing to pay within 10 days a 2% rebate on the billed amount to encourage them to pay early. 

“This way cash conversion can become faster,” he explains.

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Education Market Presents Opportunity for Turnaround

Three years ago, Chu eventually figured it out. “I wanted the company to evolve from being a branded vendor of hardware into a solution provider,” remarks Chu firmly.

The smart interactive whiteboard known as ViewBoard is the outcome of this shifting mindset.

In 2016, Chu presided over a sales representatives meeting. Reporting back to him, an American sales agent revealed that sales staff were personally touring schools to promote the smart displays because the dealers were not willing to promote ViewSonic products.

“Eight out of ten schools where we made presentations want our products; the hit rate is very high,” the sales representative told Chu excitedly.

Acting on a sudden inspiration, Chu decided to directly devote the company’s limited resources to the education market.

Since ViewSonic’s major market is the United States, Chu told his sales managers to first target the U.S. market. They were to visit school after school to present their products, and assist schools with installation, while ViewSonic staff would familiarize themselves with the interactive displays together with the teachers.

On top of that, Chu found out that the two leading competitors in the traditional interactive whiteboard sector were using closed systems that made the use of Google for Education, a globally popular teaching environment, impossible. Therefore, ViewSonic opted for an open system that was compatible with these teaching materials to provide teachers with wider and more diverse options.

This also presented a major challenge for the ViewSonic employees. Previously, they had sold through dealers, which meant they had no direct contact with the end user. Now, however, they needed to master user scenarios.

“Before, we competed on specifications and on price. But the challenge created by this new business model is that we had to go and solve customers’ problems. You need to understand the user scenario,” explains Lin, the product marketing manager, adding, “But this is easier said than done, since there are so many user scenarios.” 

Photo by Ming-Tang Huang/CW

For ViewSonic, which mainly targets the education technology sector, the user scenarios in the education field play a crucial role.

On a Thursday afternoon in the “creative classroom”, the cooperation project between ViewSonic and the NTNU College of Education, Lin Yu-tzu, associate professor at the Graduate Institute of Information and Computer Education, hands out problems to nine graduate students. These junior high school teacher candidates concentrate on the annotated teaching material on the whiteboard while considering the problems. A moment later, Lin taps on the whiteboard, immediately accessing an educational video in the cloud.

“Students can send reports from their notebooks to the whiteboard to interact with everyone. They can also engage in remote interaction with schools in rural areas. That’s something you won’t be able to achieve with traditional electronic whiteboards and projectors,” notes Lin.

Chu frankly admits that he does not want to see the interactive whiteboards that ViewSonic put in the classrooms go to waste in one or two years because the teachers don’t use them often enough simply because they are not familiar with the new technology or don’t know how to use it.

Therefore, he dispatched staff to NTNU to assist with the establishment of “faculty”, “lesson plans”, and “environments”. An interactive electronic whiteboard allows teachers to immediately go online and grab a photo or video when a certain topic comes up during discussions, or to compare the results of different student groups. 

Marketing manager Lin points out that, while this collaborative approach to teaching has been very much in vogue in Europe and the United States during the past few years, it is only in its beginning in Taiwan. Because of the interactive whiteboards, teaching behavior and models of interaction are changing; it is no longer a one-way model with only the teacher writing on a blackboard.

“Our staff keep touring schools,” says Lin. It truly no longer suffices to place hardware in classrooms. It is necessary to understand teachers’ needs regarding teaching.

Selling Hardware and Software with Customer Needs at the Core

Feeling that they are not yet doing enough, Chu established ViewSonic’s only research center at the New Taipei headquarters to develop software systems. In the past, the R&D department took the lead, handing products to the sales units only after development was complete. Now the process has been turned upside down. The salespeople hand the R&D center first-hand information about customer needs, leaving it to the developers to fulfill them. The goal is to become more responsive to user needs.

It’s been three years since the ViewBoards were released. In 2018, global sales of the interactive whiteboards grew 120 percent, helping push revenue to an eight-year high. The smart electronic whiteboards already account for 25 percent of the company’s annual revenue of more than NT$20 billion. In 2018, ViewSonic smart interactive whiteboards held rank three in the U.S. market. In 2019, they will soar to third place worldwide (excluding the Chinese market).

Contemporary artwork from Chu’s private collection not only hang on the walls of his chairman’s office but is also on display in all staff offices. (Photo by Ming-Tang Huang/CW)

When the ViewBoard was released, the recommended sales price for the 55-inch screen stood at NT$99,000. The most expensive 86-inch version had a price tag of NT$260,000, a much higher unit price than the computer monitors that ViewSonic churned out in the past, and three to four times more expensive than a TV screen of the same size. 

One floor above Chu’s office, a team of 60 software developers have set up shop over the past year. The team developed ViewSonic’s own software ecosystem called myViewBoard, which allows teacher users to build dynamic lesson plans, import content from cloud hard drives and online resources during class and share lessons with students. Since the ecosystem integrates software and hardware, the company’s own team is able to keep everything in hand. Within a year 550,000 users have registered online as members. 

“The number of registered users is not high. The software is also not yet generating revenue, but we know that this is an indispensable part of providing solutions,” explains Chu.

It’s very interesting now, I have a lot of drive, it feels like a throwback to the time when I started up the business,” notes Chu emphatically.

In the eyes of a senior industry analyst, crowding out has already started in the market for smart interactive whiteboards. Electronics giants such as Samsung and LG are eager to enter the market, whereas Chinese brands such as Seewo (Shirui Electronics), which ships 300,000 whiteboards a month, grab market share through public tenders, are relentlessly gaining strength.

“In terms of scope and capital, ViewSonic lags far behind these brands,” notes an analyst who does not wish to be named. It remains to be seen how long ViewSonic can maintain its competitive edge with this product, the analyst points out. 

On the wall of Chu’s office hang two large paintings with heart shapes. In the staff offices on the floors above and below you will find self-portraits by pop artists Andy Warhol and Yayoi Kusama. The staff cafeteria features artwork by Chinese-French painter Sanyu. All of the exhibits come from Chu’s private collection.

“Since I spend most of the day at the office, I have more opportunities to appreciate [my collection] if I hang the artwork in the office,” says Chu.

From reaching the top to hitting rock bottom, Chu has seen it all, but he has never given up on finding new opportunities to guarantee the survival of the display empire he single-handedly founded. Just like the horse in his favorite painting Wonderful Bait, Chu has jumped through a ring of fire to forcefully push ahead.

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Translated by Susanne Ganz
Edited by TC Lin, Sharon Tseng